Religious Corporation Law: Everything You Need to Know
Religious corporation law is the set of rules that govern the formation and operation of religious corporations.3 min read updated on February 01, 2023
Religious corporation law is the set of rules that govern the formation and operation of religious corporations. For instance, religious corporations are not allowed to do the following without the permission of the court or the attorney general:
- Sell their real property
- Mortgage their real property
- Lease their real property for more than five years
Plots, lots, or burial permits in a religious corporation-owned cemetery can be sold or can be partially or fully conveyed to a cemetery corporation without the permission of the court. However, no cemetery property of a religious corporation is allowed by law to be mortgaged while in use as a cemetery.
Is a Church a Corporation?
In New York, churches aren't considered corporations of any kind. Nevertheless, the archdiocese of the state is considered a religious corporation, which subjects the church itself to the Religious Corporation Law of New York. Such corporations can sell, buy, and lease properties. Furthermore, they can acquire loans by mortgaging a property owned by the church, if the court approves.
The Attorney General of New York must grant permission before these transactions can take place. This is because of the guiding rules that protect the property of churches from being sold under church members by a church leader or any individual who decides to take advantage of their position or influence to sell such property.
Board of Trustees
Several religious organizations also run other mission institutions such as schools, hospitals, wholesome-food eateries, and so on. The board of trustees generally manages the temporal affairs of religious organizations under the religious corporation law. The congregation usually elects the board of trustees. However, even religious congregations are not immune to disputes, which can arise and disrupt law and order.
Who Is a Church Member?
The law defines church members as those who are older than 18 years and regularly worship at the church in question. Some churches define members as those who partake in communion services regularly at the church or are baptized by the clergy of the church. If a dispute occurs, the court can assign an impartial mediator to verify who the real members are.
Disagreements concerning the hiring, paying, and firing of the clergy aren't totally strange. The extent to which the board of trustees has the power to hire or fire clergy is determined by specific aspects of the religious corporation law. It also depends on the kind of religion in question. If a church is connected to a bigger organization, the bigger organization may possess the exclusive right to decide the status of the clergy.
Specific provisions of the religious corporation law additionally state that, under certain circumstances, the salary of the clergy must be authorized by a vote of the whole congregation at a duly convened meeting.
A religious organization can also create its own bylaws to govern its affairs in addition to the religious corporation law. The bylaws can define the following:
- Who qualifies to be a member of the board of trustees
- How many members the board should be made of
- How to resolve disputes
- How to generally govern the religious organization
In New York, there are two ways to acquire a court approval for a religious corporation's activities. One is by direct application to the New York Attorney General. This requires a legal procedure, which makes engaging an attorney's services a necessity. This option is best suited for cases where things are running normally and peacefully with little or no likelihood of church member disputes.
When the application process is more complicated, the second option should be followed. This option is better if there's a likelihood of church member opposition. To follow the second option, the church leadership must file a petition with the Supreme Court of New York in the county where the real property of the church is situated.
The filed petition must include the fine points of the transaction proposed and the authorization of the officials of the church administration on the documents provided. All relevant information must be turned in along with the proposed contract of sale or mortgage regarding the real property.
How the religious organization is managed can result in opposition and lawsuit. There also may be other legal complications in connection with how the church is run. That's why the church needs to engage the services of an attorney to help with the whole legal process.
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